Matt Nolan

Happy Valentine’s Day: Economics and the nature of a gift

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Happy Valentine’s Day everyone, from Gulnara and myself. To celebrate we’ve put up a video characterising two different ways of thinking about gift giving – specifically the conflict between telling someone what gift you want and the nature of a surprise gift.

People think and feel very differently about this, and fair enough we all have different preferences and have been raised in different gifting cultures (influencing the type of signal a gift is).

However, by thinking about why someone may feel differently about a gift allows us all to understand these different perspectives – as they say, economics is the path to tolerance, acceptance, and ultimately love.

We would love to hear how you think about both giving and receiving presents – what have we missed?

Matt Nolan

What is happening with NZ inflation

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Walking down the street everyone is abuzz with the recent CPI numbers. 5.9% inflation! Someone’s failed! Economists are wrong for some reason! Freeze prices! Slash things! Destroy capitalists! Suppress workers! Random noises!

I’ve heard it all.

However, it made me realise something. I haven’t looked at the details of the CPI numbers for years. If the situation has changed then my inattention to these numbers may lead to me making silly decisions. Furthermore, other people’s attention to these numbers may make inflation more responsive to the CPI releases – meaning that there is more value in me paying attention.

Given all of this, and given that I wanted to reacquaint myself with the new version of the Stats NZ website, I’ve put together an excessively long video exploring the CPI data at the “product class” level. In it I also have a look at some price stickiness measures, looks at some other inflation numbers, and fail to put particularly nice labels on scatterplots – this can be found here.

If you prefer 4 minute summary videos instead, then I run through the key ideas in 3 graphs here. And if you prefer to get your own hands dirty with the data, rather than listening to me drone one, jump over here to use my R code and access Stats NZ’s data.

Do I reach any exciting policy conclusions, or give a forecast of where we are going in any of this – no. Did I have fun, and feel like I have a better understanding of the type of shock New Zealand is experiencing at the moment – yes.

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Matt Nolan

Why higher haircut prices might point to a strong economy (transcript and video)

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Seeing the price of haircuts rise, even relative to other things I might spend my money on, is the sort of thing to make an economist rail about anti-competitive behaviour. But is that really the case, or are higher haircut prices just a sign of a strengthening New Zealand economy? Gulnara and I have a think about this in a recent video.

For those who don’t like videos, there is a transcript below.

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Matt Nolan

Is haggling good actually? (video and transcript)

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In a recent video Gulnara gave us some background of haggling in the former Soviet Union, and we tried to understand some of the way we could evaluate whether it is “good or bad” beyond the standard “haggling allows for optimal price discovery” vs “haggling adds transaction costs to trading”. The video can be found here.

For those who don’t like video and just want to read the text, it can be found below.

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Matt Nolan

Why is cold and flu medication cheaper in winter? (video and transcript)

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In a recent video we’ve chatted about why cold and flu medication may be cheaper in winter than in summer – something that may seem a bit counter-intuitive. This was an issue discussed back in 2008 here and here.

For those who aren’t keen on listening to videos, I’ve popped the transcript just below 😉

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Matt Nolan

GDP and alternative measures of national income (video + transcript)

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As part of our “Data and aggregates” playlist for macroeconomics we’ve added a video on GDP as income, and how to think about other national accounts measures in terms of income – after all, in some circumstances different measures can make more sense for a given question.

For those who don’t want to listen to a video, we’ve popped the script below.

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